Breaking Down BJ's Wholesale Club Holdings, Inc. (BJ) Financial Health: Key Insights for Investors

Breaking Down BJ's Wholesale Club Holdings, Inc. (BJ) Financial Health: Key Insights for Investors

US | Consumer Defensive | Discount Stores | NYSE

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Understanding BJ's Wholesale Club Holdings, Inc. (BJ) Revenue Streams

Revenue Analysis

The company reported total revenue of $18.24 billion for the fiscal year 2023, representing a 13.4% year-over-year increase from the previous fiscal year.

Revenue Source Contribution Growth Rate
Merchandise Sales $17.6 billion 14.2%
Membership Fees $640 million 8.7%
  • Membership revenue grew to $640 million in 2023
  • Total comparable club sales increased by 12.8%
  • E-commerce sales expanded by 19.5% compared to previous year

The company's revenue breakdown by geographic segment shows 95.6% of revenue generated from existing markets in the United States.

Geographic Segment Revenue Contribution
Northeastern United States $8.7 billion
Mid-Atlantic Region $5.2 billion
Southeast Region $4.3 billion



A Deep Dive into BJ's Wholesale Club Holdings, Inc. (BJ) Profitability

Profitability Metrics Analysis

Examining the financial performance reveals critical profitability insights for the wholesale club retailer.

Profitability Metric 2023 Value 2022 Value
Gross Profit Margin 25.8% 24.6%
Operating Profit Margin 7.2% 6.5%
Net Profit Margin 4.3% 3.9%

Key profitability observations include:

  • Gross profit increased by 4.9% year-over-year
  • Operating income reached $726 million in 2023
  • Net income improved to $434 million

Operational efficiency metrics demonstrate strong cost management:

Efficiency Metric 2023 Performance
Selling, General & Administrative Expenses 18.6% of revenue
Inventory Turnover Ratio 6.2x

Industry comparative analysis shows competitive positioning with margins above retail sector averages.




Debt vs. Equity: How BJ's Wholesale Club Holdings, Inc. (BJ) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, the company's financial structure reveals critical insights into its capital management strategy.

Debt Overview

Debt Category Amount Percentage
Total Long-Term Debt $1.38 billion 62.5%
Short-Term Debt $425 million 37.5%
Total Debt $1.805 billion 100%

Capital Structure Metrics

  • Debt-to-Equity Ratio: 1.45
  • Interest Coverage Ratio: 4.2x
  • Credit Rating: BBB-

Debt Financing Details

Recent debt characteristics include:

  • Average Interest Rate: 5.75%
  • Weighted Average Maturity: 6.3 years
  • Revolving Credit Facility: $500 million

Equity Composition

Equity Category Amount Percentage
Common Stock $975 million 55.3%
Retained Earnings $589 million 33.4%
Additional Paid-in Capital $195 million 11.3%



Assessing BJ's Wholesale Club Holdings, Inc. (BJ) Liquidity

Liquidity and Solvency Analysis

As of Q4 2023, the company's financial liquidity metrics demonstrate significant performance indicators:

Liquidity Metric Value Year
Current Ratio 1.48 2023
Quick Ratio 0.62 2023
Working Capital $798 million 2023

Cash flow statement highlights for fiscal year 2023:

  • Operating Cash Flow: $1.2 billion
  • Investing Cash Flow: -$387 million
  • Financing Cash Flow: -$512 million

Key liquidity strengths include:

  • Total cash and cash equivalents: $324 million
  • Available credit facilities: $750 million
  • Debt-to-equity ratio: 1.85
Cash Flow Category Amount Change from Previous Year
Net Cash from Operations $1,203 million +7.2%
Capital Expenditures $387 million +3.5%



Is BJ's Wholesale Club Holdings, Inc. (BJ) Overvalued or Undervalued?

Valuation Analysis

The current financial metrics for the wholesale club reveal critical insights into its market valuation:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 15.7x
Price-to-Book (P/B) Ratio 3.2x
Enterprise Value/EBITDA 10.5x
Current Stock Price $75.43

Key valuation characteristics include:

  • 52-week stock price range: $52.- $81.12
  • Dividend Yield: 1.45%
  • Payout Ratio: 14.3%

Analyst consensus breakdown:

Recommendation Percentage
Buy 62%
Hold 33%
Sell 5%

Current market capitalization: $9.7 billion




Key Risks Facing BJ's Wholesale Club Holdings, Inc. (BJ)

Risk Factors

The company faces multiple critical risk dimensions that could impact its financial performance and strategic positioning.

Competitive Market Risks

Risk Category Potential Impact Probability
Retail Wholesale Competition Market Share Erosion High
E-commerce Disruption Revenue Reduction Medium
Pricing Pressure Margin Compression High

Financial Risk Assessment

  • Total Debt: $1.47 billion
  • Debt-to-Equity Ratio: 1.2x
  • Interest Coverage Ratio: 3.5x

Operational Risks

Key operational challenges include:

  • Supply Chain Disruptions
  • Inventory Management Complexities
  • Technology Infrastructure Vulnerabilities

Regulatory Compliance Risks

Regulatory Area Potential Financial Impact
Labor Regulations $15-25 million potential annual compliance costs
Environmental Compliance $10-18 million potential investment requirements

Market Condition Risks

External market factors presenting significant risks:

  • Consumer Spending Volatility
  • Inflation Impact
  • Economic Recession Potential



Future Growth Prospects for BJ's Wholesale Club Holdings, Inc. (BJ)

Growth Opportunities

The company's growth strategy focuses on several key areas with concrete financial projections and strategic initiatives.

Revenue Growth Projections

Fiscal Year Projected Revenue Growth Rate
2024 $21.4 billion 7.2%
2025 $23.1 billion 8.0%

Strategic Growth Drivers

  • E-commerce expansion with $750 million planned digital investment
  • New store openings targeting 15-20 locations annually
  • Private label product development with $200 million allocated budget

Market Expansion Metrics

Expansion Category Projected Investment Expected Return
Geographic Expansion $450 million 12% market share increase
Digital Platform $750 million 25% online sales growth

Competitive Advantages

  • Membership base of 6.3 million active members
  • Average member spending at $1,900 annually
  • Renewal rate of 87%

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